Aussie State Bonds Go Global

Australian state bonds have long been the debt market’s Cinderella but that could be changing.

Official figures show foreign demand for these securities picked up during the second quarter on the back of new demand from big buyers such as central banks and large pension funds.

In the three months to the end of June offshore ownership of state bonds–or semis–rose to 39.2% from 38.04%. In the same quarter foreign ownership of the sovereign’s securities fell, though largely because new buying didn’t keep pace with issuance.